How not to buy a plane

The Rafale saga has all the ingredients of a potboiler: a politician-civil servant nexus, tweaked standards, and the subversion of procurement procedures that are meant to ensure systemic integrity and safeguard national security.

Published : Feb 27, 2019 12:30 IST

Prime Minister Narendra Modi with French President Emmanuel Macron before they made a joint press statement in New Delhi on March 10, 2018.

Prime Minister Narendra Modi with French President Emmanuel Macron before they made a joint press statement in New Delhi on March 10, 2018.

WITH the controversy over the Rafale deal simmering in the last few months, the ordinary Indian remains flummoxed. There are two primary reasons for this. The first pertains to the process by which defence equipment in general, and aircraft in this case, is purchased. Since they are meant to last three or four decades, are mission-critical and require a continuous provision of service and maintenance, they are very different “commodities” from what the citizen normally encounters. But what really obfuscates matters is the fact that these deals are shrouded in secrecy in the guise of being matters of national security and are therefore not available for scrutiny.

To understand what is really going on, it becomes necessary to study how governance evolved over time, ultimately giving rise to modern governance.

Centuries ago, owing to the lack of communication technology, an empire had to resort to decentralised government. Rajas, nawabs and governors administered their own territories under the overarching command of the empire. They had only a fiduciary responsibility to the emperor in order to maintain the emperor’s armies. The emperor had only two main functionaries under him: the commander-in-chief for temporal functions and the chief brahmin/ulema for the spiritual control of his subjects.

With the development of communications, it became possible to appoint servants of empire to far-flung posts. With the advent of the steam engine and the telegraph, it became possible to administer distant parts of the empire directly by means of a new administrative invention: the civil servant, who was the natural evolution of the patwari and the munim.

Rajas and zamindars of old passed into history, and under a secular dispensation, the brahmin/ulema also passed into history. Thus, today, the civil servant pervades all walks of life.

Civil servant as pivot

Since the main purpose of the civil servant is the mobilisation of funds from any discipline under confidentiality, there is a necessity for a cabal of civil servants to be formed to collectively pursue their interest of loyalty to the emperor. In return, the politician allows power to the babu over other forms of government such as the judiciary, the police and the armed forces. The civil servant is the framer and keeper of the rules. All this works very well except when there is a rebellion in the ranks.

Our public sector undertakings (PSUs), instead of being cash cows, are a drain on the exchequer. This rebellion comes in the form of the technically qualified management whose aims are a commitment to the production process and at variance with that of the civil servant. When the production process does not work, the blame goes to the top management, which is invariably the civil servant. Air India is a great example of such a disaster. The Chairman is an IAS officer and so are the Director General of Civil Aviation and the Civil Aviation Secretary. It takes decades to set things right, if at all. The armed forces, being professional and technocentric, may also be called a PSU except that they produce no tangibles but security.

With this background in mind, we now come to the system of purchase of aircraft and other high-value items for the military. The military is the single biggest consumer from our national income.

Why did India need the Rafale? It was a national requirement. And how did it come to be a national requirement? Security of the borders and national sovereignty are a function of the political establishment. With the help of the government agencies concerned, an assessment is carried out to determine the threats facing the country and the military force levels required to neutralise the threat.

Ideally, such an assessment ought to look a few decades ahead to counter emergent scenarios. The military keeps its eyes and ears open to watch out for emerging trends in warfare, doctrines and the conduct of battles fought elsewhere around the world. That would be the foundation of a national strategy.

Strategy is largely a military process in which all other disciplines are required to contribute. But with a generalist civil servant at the head of a strategic conclave, it is only proper to say that our country has no strategic perspective.

There are several examples. The Chinese have been building a vast infrastructure in Tibet for the last 12 years, but we have been asleep, entranced by the Foreign Office lullaby of “soft power” and “economic engagement”. India did not believe in gunboat diplomacy (until the Maldives gave us a shock and we were obliged to deploy our entire fleet). It all just plays back into the civil servant’s hand. He has all the authority but no responsibility and no strategic goal to attain. The armed forces have been reduced to hewers of wood and drawers of water. The only document the Indian Air Force (IAF) has in hand is this myopic “strategic” vision. The net result is ad hoc planning.

An interesting aside here: The British in India had strategic vision. That is how they played the great game. The Secretary for Defence was the person responsible for the defence of India. He was no civil servant but a political appointee of the British Parliament and he was invariably a soldier of impeccable reputation or one closely associated with defence.

An ageing fleet

The Directorate of Plans is the nodal agency in Air Headquarters responsible for strategic vision. It runs a top-secret document called the long term re-equipment plan, or LTREP. On the basis of national intelligence assessment, subdivided into areas of military responsibility, a certain force level is authorised. This force level is required for a minimum of 60 per cent assurance against any air contingency. This force level is currently at 42 squadrons, but in fact, the IAF is down to just 30 squadrons.

The Rafale was originally a replacement for the MiG 21bis, which has become obsolete. Can the IAF afford to withdraw the MiGs when it is already short of its minimum fleet strength? With the MiGs due to reach their end-of-life, the IAF may soon be down to just 26 squadrons. Why did “Make in India” acquire so much importance in a situation of critical shortage when, with the same money, you could have bought at least 72 aircraft?

With no strategy and with depleted holdings, this LTREP has become only a mishmash of various tables giving the life of current holdings and when they are due for replacement. When replacement is due, a statement of case is initiated with the Ministry of Defence to replace and procure in order to preserve the required fleet strength.

For the civil servant, who may be largely ignorant of the technical parameters of the case, such an acquisition provides an opportunity to exercise power, especially because of the large amounts of money needed for foreign acquisitions. Typically, the civil servant, in order to educate himself and ensure one-upmanship over the Service Headquarters, reaches out to the arms agents, often nominated by the politician. The most infamous incident here was the case of Lt Gen. Tejinder Singh arrogantly walking into the Army Chief’s office and offering a bribe of Rs.14 crore to clear the purchase of Tatra HMVs for the Army. Could he have done it without the backing of the politician and friendly civil servants? The moment the top-secret statement of case leaves Air Headquarters it is available to the relevant arms merchants, the Official Secrets Act be damned. A top-secret letter from General V.K. Singh to the Prime Minister pointing out the availability of only four days’ tank ammunition was leaked to the press with absolutely no repercussions.

Once approval for acquisition is given and the approximate funds are identified, the Air Force sets about preparing the Request For Proposals (RFP). In this, the Directorate of Air Staff Requirements delineates the performance it wants in the aircraft. The arms merchants go into overdrive. They can even go about tweaking the RFP so that their product best fits the slot—this happened in the Rafale case too.

One might imagine that the Air Force has independent ideas guided by optimal defence given that all the three forces in India are run by a line of succession. But the reality is different: the last Army Chief superseded two of his peers. It is not difficult to guess who controls the line of succession. Even clairvoyant strategists have been fooled into thinking that the armed forces enjoy independence in defence matters.

Aircraft trials

Trials are conducted on the aircraft offered by the vendors. These trials are amenable to “adjustments”. In the AgustaWestland case, trials were not even conducted on the type on offer but on one with claimed “similar” capabilities. Not to mention that the AgustaWestland did not even meet the original RFP, but an RFP that was modified.

In the case of the Rafale, the aircraft had the proverbial nine lives of a cat—actually seven, that is, the Rafale failed seven times. Incidentally, only the MiG 35 passed all the tests in one shot. The Russians were most willing to manufacture it in India, which ought to have satisfied the “Make in India” enthusiasts. Moreover, the Russians have had long association with Hindustan Aeronautics Limited (HAL).

The shortlisted vendors are invited to make their financial bids. It is during the financial bids that the price negotiating committee (team) comes into play. This committee works under the constraints of the Defence Procurement Procedure (DPP). The DPP is nothing but a compilation of mistakes made in the past to prevent recurrence and to encourage the “Make in India” initiative.

Among the acquisition categories, there is one called Buy (Global). Its definition says: “Buy (Global) category refers to outright purchase of equipment from foreign or Indian vendors. In case of procurement through foreign vendors, government to government route may be adopted, for equipment meeting strategic/long-term requirements.” What could be simpler than that? In the government to government route, only the civil servant is involved. An old joke at Air Headquarters was: “Show us the vendor and the Ministry will show you the policy.” This author was involved in the acquisitions of the Mirage 2000 and the MiG 29. The MiG 29s came to India without the slipper fuel tanks, a low-cost item but critical to the range performance of the aircraft. Similarly, weaponry for the Mirage 2000 came three years late. That meant for three years the Mirage 2000 was an expensive ballerina of the skies. In the Rafale deal, there was an Air Vice-Marshal at the head of the team, a departure from the norm.

One of the accusations against the Rafale deal is that the pricing details have been withheld. Therein lies the meat of the matter. It is the pricing details which will reveal where the money went. All national institutions, including the Supreme Court and the Comptroller and Auditor General, as well as the government of France, have been used to provide a smokescreen.

There are also accusations that in the “Make in India” initiative, Rs.30,000 crore was sought to be siphoned off to a crony capitalist who just recently acquired a piece of land with just a tin shed on it and who has also filed for bankruptcy. It appears that the acquisitions of the 36 aircraft was a rush job, which even the Defence Minister was possibly not aware of. The base price of the aircraft was recalculated upwards. All these remain accusations in the absence of of black and white figures.

An extraordinary feature of the Rafale deal has been the confidence with which the civil servant has exposed the military officer to public glare to buttress his position. Contrast this with the Bofors scandal when General Sundarji, the then Army Chief, refused to comment on the price of the Bofors gun. The military officer needs to have the confidence of his men; he could be sending them to their deaths in war.

Over the years, the Government of India has evolved into a closed system of government. All national institutions have been systematically degraded. The civil servant has risen to the top as the master of all. The armed forces have suffered and find no place at the table.

Wing Commander Rajesh Khosla, a fighter pilot in the Indian Air Force, served at Air Headquarters and retired in 1991. After a career as a civil pilot, he served as project director in Afghanistan’s domestic airline.

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